Many consumers feel quality plays second fiddle to stock price

Even bullish markets don't excite skittish consumers who worry that quality may be traded for profit. How much is this perception reinforced when once-thriving stock declines, as has happened to some large, publicly traded HMOs recently?

The total stock value of the HMO industry grew 13-fold between January 1987 and November 1997, according to the Henry J. Kaiser Family Foundation. Compare that with the growth of the stock market as a whole during the same period, "only" four-fold, and you can see why investors jumped aboard. Still, there's that nagging fear that what goes up.... Several large publicly traded HMOs lost market value in 1997.

The question persists: Are the dual goals of pleasing shareholders and delivering high quality health care contradictory? We can't answer that, but we can report what consumers told the foundation in a survey earlier this year.